Takt

Takt time can be defined as the maximum time per unit allowed to produce a product in order to meet demand. It is derived from the German word Taktzeit which translates to cycle time. Takt time sets the pace for industrial manufacturing lines. In automobile manufacturing, for example, cars are assembled on a line, and are moved on to the next station after a certain time - the takt time. Therefore, the time needed to complete work on each station has to be less than the takt time in order for the product to be completed within the alloted time.

Net available time is the amount of time available for work to be done. This excludes break times and any expected stoppage time (for example scheduled maintenance, team briefings, etc.).

Example:
if you have a total of 8 hours (or 480 minutes) in a shift (gross time) less 30 minutes lunch, 30 minutes for breaks (2 x 15 mins), 10 minutes for a team briefing and 10 minutes for basic maintenance checks, then the net Available Time to Work = 480 - 30 - 30 - 10 - 10 = 400 minutes.

If customer demand was, say, 400 units a day and you were running one shift, then your line would be required to spend a maximum of one minute to make a part in order to be able to keep up with Customer Demand.

In reality, people and machines can never maintain 100% efficiency and there may also be stoppages for other reasons, so allowances will need to be made for these instances and thus you will set up your line to run at a faster rate to account for this.

Also, you may choose to adjust takt time according to requirements within the company. For example, if there is one department that delivers parts to several manufacturing lines it often makes sense to use similar takt times on all lines to smooth out flow from the preceding station. Customer demand can still be met by adjusting daily working time, reducing down times on machines and so on.

Implementation

Takt time can be calculated on virtually every task in a business environment. It can be used in manufacturing (casting of parts, drilling holes or preparing a workplace for another task), control tasks (testing of parts, adjusting machinery) or in administration (answering standard inquiries, call center operation). It is, however, most common in production lines that move a product along a line of stations that each perform a set of predefined tasks.

Once a takt system is implemented there are a number of benefits:

The product moves along a line, so bottlenecks (stations that need more time than planned) are easily identified when the product does not move on in time.
Correspondingly, stations that don't operate reliably (suffer frequent breakdown, etc.) are easily identified.
The takt leaves only a certain amount of time to perform the actual value added work. Therefore there is a strong motivation to get rid of all non value-adding tasks (like machine set-up, gathering of tools, transporting products, etc.)
Workers and machines perform sets of similar tasks, so they don't have to adapt to new processes every day, increasing their productivity.
As all products are "stuck" in the line and cannot leave it; they cannot be "lost" somewhere on the shop floor.

Downsides of takt time organization include:

When customer demand rises so much that takt time has to come down, quite a few tasks have to be either reorganized to take even less time to fit into the shorter takt time, or they have to be split up between two stations (which means another station has to be squeezed into the line and workers have to adapt to the new setup)
When one station in the line breaks down for whatever reason the whole line comes to a grinding halt, unless there are buffer capacities for preceding stations to get rid of their products and following stations to feed from. A built-in buffer of three to five percent downtime can allow for needed adjustments or recovery from failures.
When the takt time is too short this can put considerable stress on workers and machines, increasing breakdowns and lowering motivation to the point of absenteeism.
Tasks have to be leveled to make sure tasks don't bulk in front of certain stations due to peaks in workload. This decreases the flexibility of the system as a whole.